What are the keys to good economic policy? George P. Shultz and John B. Taylor draw from their several decades of experience at the forefront of national economic policy making to show how market fundamentals beat politically popular government interventions—be they from Democrats or Republicans—as a recipe for success.
Choose Economic Freedom reconstructs debates from the 1960s and 1970s about the use of wage and price controls as tools of policy, showing how brilliant economists can hold diametrically opposed views about the wisdom of using government intervention to spur the economy. Speeches and documents from the era include a recently unearthed memo from Arthur Burns, Federal Reserve chair, in 1971, in which he argues in favor of controls.
Under Burns’s guidance and in the face of stubborn inflation, Nixon introduced wage and price guidelines and freezes. But over the long run, these became a drag on the economy and ultimately failed. It wasn’t until the Reagan administration that these controls were reversed, resulting in a vibrant economy.
The words of iconic economist Milton Friedman—whose “free to choose” ethos inspired the free-market revolution of the Reagan era—along with lessons Shultz and Taylor learned from the front lines, demonstrate that tried-and-true economic policy works.
ABOUT THE AUTHORS
George P. Shultz, the Thomas W. and Susan B. Ford Distinguished Fellow at the Hoover Institution, has had an eminent career in government, academia, and business. Shultz served three positions in the cabinet of Richard Nixon and was Ronald Reagan’s secretary of state from 1982 until 1989.
John B. Taylor is the George P. Shultz Senior Fellow in Economics at the Hoover Institution and the Mary and Robert Raymond Professor of Economics at Stanford University. After serving on the Council of Economic Advisers for Gerald Ford, Jimmy Carter, and George H. W. Bush, Taylor was under secretary of the Treasury under George W. Bush.
The book also features a number of historical excerpts from Milton Friedman, recipient of the 1976 Nobel Prize in economics and a senior research fellow at the Hoover Institution from 1977 to 2006. Friedman was widely regarded as the leader of the Chicago School of economics, and his research emphasized the preservation and extension of individual freedom.